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Vietnam was heard paying $300-305 per tonne cfr for Japanese H2 scrap in bulk at the end of last week, which Japanese sources said was equivalent to around ¥28,500 per tonne fob.
One South Korean mill was heard to have purchased a cargo of 2,000 tonnes of Japanese H1:H2 (50:50) at ¥29,900 per tonne cfr last week, which would be equivalent to around ¥28,000 per tonne fob for the grade, which usually commands a $5-per-tonne premium over H2.
The lowest offer level heard for H2 so far this week was ¥28,500-29,000 per tonne fob Japan, but a Japanese trader said that Vietnam mills were able to pay around ¥29,000 per tonne fob in the current market environment.
Fastmarkets’ price assessment for steel scrap H2, export, fob main port Japan was ¥28,000-29,000 ($268-278) per tonne on Wednesday October 28, widening up by ¥500 per tonne from ¥28,000-28,500 per tonne a week earlier.
Japanese suppliers are in a bullish mood this week and are demanding higher prices from Vietnam, sources said.
“The bid price from mills in Vietnam is now $305 per tonne cfr for H2, but no supplier will accept that price now. I think the price will rise again soon,” a second Japanese scrap trader told Fastmarkets.
Reports of a recent US-origin deep-sea cargo booked at competitive prices in the last week has further complicated the market picture in Vietnam, sources said.
A deal for 30,000 tonnes of US West Coast scrap was heard sold at an average price of $310-312 per tonne cfr Vietnam earlier this week after the same cargo was offered to the port of Karachi in Pakistan, a South Asian trader said.
“If US exporters are ready to make a deal at $305-310 per tonne cfr Vietnam for HMS 1&2 (80:20), that’s cheaper than Japan scrap and Japanese scrap will hit a peak soon,” a Japanese supplier said.
Supply-side pressure in the US and other key supplier countries will raise global scrap prices toward the end of the year, the supplier said, adding that steel mills must now focus on raising their finished steel prices more.
Rising prices are also being passed on to South Korean consumers, although demand in the East Asian country is muted.
“South Korea is very quiet and not many of their mills are in the market. Market participants in Korea bought at lower prices last week but they’ll now have to pay ¥28,000 per tonne fob for H2 or more,” a third Japanese trader told Fastmarkets.
Higher grade prices inch up further South Korean mills continued focusing on higher grades of Japanese scrap over the week, while offer prices for the material continued to rise.
Shindachi bara was sold to South Korea at ¥33,000 per tonne cfr late last week – equivalent to ¥31,000 per tonne fob -while offers for the grade were heard at ¥31,500-32,000 per tonne fob, sources said.
Fastmarkets’ price assessment for steel scrap, Shindachi, export, fob main port Japan was ¥31,000-31,500 per tonne on Wednesday, up by ¥500 per tonne from ¥30,500-31,000 per tonne a week earlier.
Japanese plate and structural (P&S) was transacted to South Korea at ¥32,500 per tonne cfr late last week – equivalent to ¥30,500 per tonne fob – while offers for P&S were heard at ¥31,500-32,000 per tonne fob.
Fastmarkets’ price assessment for steel scrap, P&S export, fob main port Japan was ¥30,500-31,500 per tonne on Wednesday, widening up by ¥1,000 per tonne from ¥30,500 per tonne a week earlier.
No new deals were heard for shredded scrap in bulk from Japan, but offer prices were at ¥31,000-32,000 per tonne fob depending on supplier.
Therefore, Fastmarkets’ price assessment for steel scrap, shredded, export, fob main port Japan was ¥31,000 per tonne fob on Wednesday, up by ¥1,000 per tonne from ¥30,000 per tonne a week earlier.
(Fastmarkets’ price assessment for steel scrap H2, export, fob main port Japan had been erroneously listed as ¥28,000-28,500 per tonne when this story was originally published. This has since been corrected to ¥28,000-29,000 per tonne.)